In the US today, kids represent a population of 50 million and $1.2 trillion in annual purchase power. What influence do they have upon family purchases?

Viacom recently released Kidfluence, a project focusing on kids’ role in American family spending. The study featured a survey of 400 parents and kids aged 6 to 14 in the US, as well as family ethnographies and in-home interviews. Here are key findings:

American kids have a lot of say in family purchases. Three-quarters of parents (76%) say that kids influence their family purchase decisions. In contrast, just 23% told us they the parents decide. Kids’ influence is especially strong in households with one child, with two parents who work full-time, and in urban areas.

Parents and kids play different roles in the purchase process. Parents act as purchase managers – taking suggestions from family members, considering the options, and seeking common ground. When kids’ requests seem over the top, they’re also the voice of reason. Kids, meanwhile, tend to be the arbiters of cool. Their tech skills come in handy for researching brand options. When they like a brand, they’ll make a case for it. And they have growing veto power over family purchase decisions.

The path to purchase for families in the US breaks down into four steps.

1. Identify the need. Nearly 9 out of 10 parents (87%) note that something needs to be purchased, then bring it up with the family.
2. Evaluate the options. Families collaborate to research possible purchases. Parents’ main information sources are TV ads, websites and their kids. Kids turn to friends, TV ads and family. TV is influential – kids are more likely than parents to remember commercials (87% vs. 78%). Additionally, 77% of parents say their kids have asked them to buy products they saw on TV – and 73% have purchased them!
3. Make a decision. For parents and kids alike, rational and emotional factors influence purchase decisions. The main rational driver is simply finding a product people like. Parents want something their kids will like; kids want something everyone (themselves included!) will like. Cost is also an important rational concern for parents. The main emotional driver for parents and kids is facilitating quality time as a family. Additionally, parents want to feel like heroes to their kids. Kids want to feel trusted and respected, and to escape the pressures placed on today’s kids.
4. Purchase the product. With a whole household to equip, parents are big spenders. On average, they spend 59% more than non-parents. And when kids are involved, parents spend 60% more than when deciding alone.

Drivers of family collaboration: Millennial upbringing, tech access, financial awareness, and family closeness. Millennial parents are more likely than older parents to allow a more kid-driven approach to family purchases. With 11.7 devices on average in each US household, kids have unprecedented access to brand information. Today’s kids are also more financially savvy than prior generations, with 60% aware of their household budget and 45% aware of what things cost. And finally, families today are very close – 78% of kids look up to Mom and Dad, and 95% of parents say they share most things with their kids.

What should advertisers focus on when crafting messages for families? These four elements: bringing families closer together, teaching kids important life skills, making kids feel respected and accepted, and endorsing the occasional splurge.